Financ Financial ial inf infor orma mation tion as of as of Mar March 31, 2020 h 31, 2020 May 12 th 2020
Key priorities in the Covid crisis Strategic priorities in 2020 ⚫ Employee and contractor health and safety ⚫ Geographic selectivity : exit from >25 countries ⚫ Business continuity and customer support ⚫ Greater selectivity for Client Solutions ⚫ Financial mitigation and protection of liquidity ⚫ Continued development in renewable capacity Ensure the company is well positioned for the future 2 May 12 th 2020
RESILIENT RESULTS DESPITE FIRST EFFECTS OF COVID-19 PANDEMIC DIFFERENTIATED COVID-19 IMPACT MAGNITUDES ACROSS BUSINESS LINES MITIGATING ACTIONS IN PROGRESS PREPARING FOR REBOUND: CRISIS WILL ACCELERATE STRATEGY OF GREATER SELECTIVITY 3 May 12 th 2020
Q1 RESULTS – In €bn, ∆ ∆ Organic growth excluding unaudited figures (1) Gross (2) Organic (2) Actual temperature EBITDA 3.1 -2% +1% +4% COI 1.9 -7% -2% +2% +2.0 (3) FINANCIAL NET DEBT 27.9 - CFFO (4) 0.2 +0.1 - COI YoY gross evolution - by reportable segment FRANCE INFRASTRUCTURES FRANCE EXCL. INFRASTRUCTURES REST OF EUROPE LATIN AMERICA = OTHER USA & CANADA MIDDLE EAST, ASIA & AFRICA (1) Unaudited figures throughout the presentation (2) Unaudited 2019 figures adjusted for revised definition of COI (3) Vs Dec. 2019 (4) Cash Flow From Operations = Free Cash Flow before Maintenance Capex 4 May 12 th 2020
In €Mn - 41M€ organic of which - 82 M€ temperature in France 2,041 -93 -97 1,907 +72 +87 -52 -51 +47 -46 Scope -66 FX -27 Client Networks Renewables Thermal Nuclear Supply GEM, Solutions Corporate COI Q1 & other COI Q1 2019 2020 5 May 12 th 2020
Y/Y In €Mn ORGANIC CHANGE KEY DRIVERS Lockdown measures started to have a significant impact on asset light activities and Suez CLIENT -97 Implementation costs and ramp-up in growth drivers, negative climate effects SOLUTIONS Further increase in backlog Gas distribution: lower distributed volumes, warmer temperatures in France and Romania NETWORKS -46 Gas transmission: 2019 annual tariff reviews in France RENEWABLES +47 Increased hydro volume in France and commissioning of wind & solar assets Europe: strong 2019 comps and lower spreads partly offset by the return of UK capacity market THERMAL -51 Lower prices in Chile and PPA expiry in Turkey NUCLEAR +87 Higher achieved prices and lower Opex Warmer temperature in France and Belgium, lower performance in Australia SUPPLY -52 Lower consumption from B2B consumers due to lockdown restrictions Higher margins in French B2C and better results of the supply activities in Romania GEM market activities OTHER +72 GTT: strong performance and higher backlog 6 May 12 th 2020
INITIAL RELATIVE LOCKDOWN IMPACT POST LOCKDOWN DRIVERS IMPACT ⚫ Covid-19 impacts vary by business model ⚫ Duration of site closures and lifting of restrictions ⚫ Reduced activity in Projects (-c.75%) and Recurring CLIENT ⚫ Governmental support on temporary unemployment Services (-c.60%) during containment SOLUTIONS ⚫ Slope of post-crisis recovery ⚫ Limited impact on Asset-based solutions (excluding ⚫ Potential impact from customer claims Suez) given contracts/feed in tariffs ⚫ ⚫ Lower gas volumes distributed in France Timing of work sites reopening NETWORKS ⚫ ⚫ Lower industrial volumes in LatAm Impact on international activities ⚫ ⚫ Delays in selected asset commissioning Potential delay of commissioning and sell-downs RENEWABLES ⚫ ⚫ Simultaneous impact from Brazilian real Forex and timing of favorable ruling in Brazil ⚫ Evolution of power spreads THERMAL ⚫ No impact in Q1 ⚫ Impact on demand in some countries ⚫ No impact in Q1 ⚫ Evolution of power prices NUCLEAR ⚫ Continued mobilization to secure energy supply ⚫ Schedules of maintenance works and ongoing LTO works ⚫ Slope of recovery in industrial demand ⚫ Lower B2B consumption SUPPLY ⚫ B2C: impact of bad debt and duration of service ⚫ Difficulties in B2C services freeze 7 May 12 th 2020
Immediate response Forward impact mitigation ⚫ Enable employees to return to work and serve our customers, while respecting all safety measures ⚫ Robust actions taken to protect employees and ensure resilience in the delivery of essential services ⚫ Strict operational expenditure management on fixed and variable costs: ⚫ Client solutions focus: costs variabillization to the fullest extent ⚫ Board acted with prudence in this context possible; target business selectivity ⚫ 2020 guidance withdrawal ⚫ Recalibration of business development expenses to reduce and target spending ⚫ 2019 dividend cancellation ⚫ Procurement: demand management and optimized partnerships with major suppliers ⚫ Capital expenditure reduction through postponement ⚫ Strong liquidity position enhanced and greater selectivity ⚫ €19.2bn of liquidity end of Q1 ⚫ Further refining our views on focus and selectivity ⚫ €2.5bn bond issuance in March in light of post Covid-19 realities 8 May 12 th 2020
⚫ Scrutiny of market-level profit pools and return expectations to drive greater geographic selectivity, differentiated by business segment ⚫ Strategic emphasis favoring markets with significant existing or potential scale and attractive growth profiles ⚫ Stepped-up market rationalization target: ambition to exit >25 countries ⚫ Limited COI dilution expected ⚫ Further rationalization of Client Solutions activities, exiting businesses with low profitability or non-core 9 May 12 th 2020
Strong liquidity Net financial debt and cost of gross debt In €bn 0.2 0.1 27.9 2.3 (0.4) (0.2) 25.9 ⚫ Recent successful bond issuance of €2.5bn Gross Scope (2) Dividends Others CFFO Dec. March Capex (1) 2019 2020 ⚫ €19.2bn of liquidity at March 31, 2020 Cost of 2.70% 2.80% gross debt Rating reviews Leverage ratios Net financial debt / EBITDA Net economic debt / EBITDA ⚫ On April 24, 2020, S&P lowered its long-term rating to BBB+ 4.3 4.0 and its short-term rating to A-2 2.7 2.5 On May 5, 2020 Moody’s affirmed ⚫ its long-term rating of A3 and changed the outlook from stable to negative Dec. 19 March 20 (1) Net DBSO impacts (2) Including net scope impact from disposals & acquisitions 10 May 12 th 2020
RESILIENT Q1 2020 RESULTS DESPITE FIRST EFFECTS OF COVID-19 PANDEMIC COVID-19 BACKDROP PROVIDING UNEVEN IMPACT ACROSS BUSINESS LINES; ACTION PLANS AND EVALUATIONS OF RECOVERY SCENARIOS ARE ONGOING ENTIRE GROUP ENGAGED TO LIMIT NEGATIVE IMPACTS; MANAGEMENT PREPARING FOR THE REBOUND STRATEGY ACCELERATION OF GREATER SELECTIVITY IN RESPONSE TO CRISIS 11 May 12 th 2020
Q&A Q&A May 12 th 2020 12
Ad Additional ditional ma material terial May 12 th 2020 13
Lower taxes and interest paid, and commodity related margin calls and financial derivatives drive increase In €bn 0.19 +0.07 +0.08 Taxes & incl.Margin Interest paid Calls 0.06 & financial -0.02 derivatives Operating Delta Cash Flow WCR CFFO CFFO Q1 2020 Q1 2019 14 May 12 th 2020
2020 2020 integrated report, sustainability published in April book for with a dedicated climate leaflet investors New green bond framework Endorsement for the latest issuance of Bteam principles of €1.5 bn for Group tax policy 15 May 12 th 2020
A A- 82 ENGIE 75 B A 75 Sector average 73 66 BBB 55 48 2019 2019 2019 2019 Climat 2019 Water 2019 New rating from Ecovadis, up 7 points in April 2020 (1) Sector CDP (EDF, EON, RWE, ENEL, IBERDROLA, ENGIE) 16 May 12 th 2020
Nuclear & Hydro €/MWh 3-year rolling hedging policy 100% 87% 60% 30% 9% 47 46 47 42 36 2019 2020 2021 2022 2023 As of 3/31/20 Belgium and France (+ Germany until April 2019) 17 May 12 th 2020
Forward-Looking statements This communication contains forward-looking information and statements. These statements include financial projections, synergies, cost-savings and estimates, statements regarding plans, objectives, savings, expectations and benefits from the transactions and expectations with respect to future operations, products and services, and statements regarding future performance. Although the management of ENGIE believes that the expectations reflected in such forward-looking statements are reasonable, investors and holders of ENGIE securities are cautioned that forward-looking information and statements are not guarantees of future performances and are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of ENGIE, that could cause actual results, developments, synergies, savings and benefits to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include those discussed or identified in the public filings made by ENGIE with the Autorité des Marchés Financiers (AMF), including those listed under “ facteurs de risque ” (risk factors) section in the Universal Registration Document filed by ENGIE (ex GDF SUEZ) with the AMF on March 18, 2020 (under number D.20-141). Investors and holders of ENGIE securities should consider that the occurrence of some or all of these risks may have a material adverse effect on ENGIE. 18 May 12 th 2020
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